Irs Agents Tell Of Bullying, Armed Raids On Taxpayers

Witness: Official Stole Up To 20 Cars

April 29, 1998|By DAVID CAY JOHNSTON The New York Times

WASHINGTON — The Senate Finance Committee heard sworn testimony on Tuesday that the IRS tolerated car thefts and anonymous bullying by its agents, conducted armed raids on nonviolent taxpayers, had promoted a sexual harasser to its top equal-opportunity post and generally looked after its officials with scant regard for the public.

The testimony opened a second round of hearings into IRS abuses of taxpayers, as Senate Republicans, preparing for a vote next week on legislation to overhaul the agency, sought to build on what polling shows to be their most potent issue after hearings last September.

Democrats, on the other hand, said that anecdotal cases of misconduct were being overblown, that Congress was to blame for most of the problems at the IRS and that the Republicans were ignoring increased tax cheating.

One witness on Tuesday was a Treasury Department inspector, Harry Patsalides, who told of an IRS agent who stole as many as 20 cars that had been seized in criminal tax investigations. Patsalides, who said the agent had retired while under investigation and had then been convicted, declined to identify him.

So did IRS chief spokesman, Frank Keith, who said that under law he could not disclose the agent's name even though a criminal court record exists, because his corrupt conduct became known during a tax investigation. ``I had our lawyers looking into this for three hours this afternoon,'' Keith said, ``and they say we can't name him.''

The most dramatic cases recounted on Tuesday involved armed IRS agents who conducted military-style raids on taxpayers not suspected of violence or even major fraud.

But Sen. Bob Kerrey, D-Neb., blamed the excesses on Congress, which, over the objections of IRS officials, ordered the agency to join the anti-drug effort and work closely with the Drug Enforcement Administration, whose agents routinely use aggressive paramilitary tactics.

Patsalides said his office had far too few resources to investigate all credible complaints. But he pledged to pursue an anonymous letter, received by a Los Angeles tax lawyer, that threatened that ``you and your clients are next'' and that ``you are currently under investigation, and I'm waiting for the day your name is in the paper.''

The anonymous note was prepared on a typewriter in an IRS criminal investigator's office, Patsalides said, but when the agent denied typing it, the agency closed the case. Patsalides said he thought that a more thorough investigation would establish the agent's responsibility, and promised to reopen the inquiry.

Patsalides and other witnesses also told of a revenue service executive accused of sexual harassment who was promoted to director of equal employment opportunity. In that job, more women complained about him, resulting in his being moved to another executive post.

The most senior IRS official under fire on Tuesday was Deputy Commissioner Michael Dolan. Yvonne Desjardines, the chief of employee and labor relations in the office of the agency's general counsel, told of investigations into various complaints against executives _ sexual harassment, fraud and pay without work _ that were forwarded to Dolan's office, where, she said, they died.

When Desjardines was questioned by the committee, however, some of the ``serious misconduct'' she alleged seemed to involve trivialities, such as an IRS executive's using a free companion ticket to take an unidentified person on a trip.